Effective Strategies for Trademark Infringement & Unfair Competition Civil Litigation in China
After years of following advice from their long-term trusted IP agency in Beijing, the European client realized that the infringers continued to exploit their brand and flood the market. This prompted them to seek an alternative solution.
Client: “We barely could make sense of the complicated legal proceedings in China. When we were advised to take necessary action like file invalidation against the targeted trademark, we entrusted the local Beijing IP agency to do it. We paid a lot of bills sent to us, but the situation didn’t seem to improve. To make it worse, once one invalidation granted, the infringer just registered more trademarks that still similar to our brand circumventing the legal liabilities… “
The “invalidation” mentioned by the Client refers to a pertinent administrative proceedings that processed by the China National Intellectual Property Administration (CNIPA).
We pointed out:
- Upon seeking protection through the IP-related administrative channel and receiving a ruling from CNIPA, it’s important to note that the nature of such ruling is administrative rather than judicial.
- Failing to file an appeal against such ruling through administrative channels, or directly seeking recourse with the Beijing Intellectual Property Court within the specified statute of limitations, will NOT directly impact any civil litigation you may pursue in the People’s Court.
- Such administrative ruling could be used as supportive evidence for a civil “trademark infringement & unfair competition” case that could be filed with the local court of jurisdiction.
Some IP agencies in China may refer to their office as an “IP law office” or even a “law firm,” but they do not operate in accordance with the Lawyer Law of PRC; i.e.,Their attorneys are not authorized to practice law as licensed lawyers, let alone possess experience in litigating in People’s Court. These agencies operate with a distinct consulting business model, typically characterized by a systematic approach, and specialize in proficiently managing IP registration and related administrative procedures.
In hearing the client’s story, we also realized that there is an even much bigger reason that hindered their access to adopting a more pragmatic way to solve the issue. The complexity of a civil litigation of “trademark infringement and unfair competition” has posed a significant challenge, requiring careful navigation through legal intricacies and potential ramifications.
Strategies for Meeting Client’s Objectives
We carefully integrated the client’s specific goals and objectives into the civil litigation proposal, ensuring that our plan aligned perfectly with their needs and priorities.
“Shutting down their factory”, and “stopping their sales and distribution.”
As soon as the case is registered, we will petition for a temporary injunction with the court for the hearing. If the defendants disregard such injunction, they shall face severe judicial consequences.
We could file a compliant with the local Market Supervision Administration, i.e. the relevant administrative authority that protects the legitimate rights and interests of businesses and consumers by carrying out regulations in the fields of enterprise registration, market competition, consumer protection, trademark protection etc. The Administration is responsible for creating a regulated market environment of fairness and transparency.
“Claim of compensation”
A favorable judicial decision will lead to the client being eligible for financial compensation. The precise amount is contingent upon the presentation of evidence, statutory provisions, and ultimately subject to the judge’s discretion.
Litigating costs, e.g. lawyer fee, court fee and notary fee that occurred to the client can be listed as separated claims that are to be ruled by the court and sustained by the defendant when the plaintiff triumphed.
The client also inquired whether such infringement constitutes a criminal offense. Based on the findings in the litigation, we may report to the local authorities for investigation if the infringement violates criminal law, and hold the infringer accountable for the offense.
Essential Preparations
In this case, the infringer created and own a website to promote products that violate the client’s trademark. To the purpose of successfully initiate the litigation, we advise the following necessary two steps need to be taken:
- Notarise the infringer’s website and owner information, which shall be used as basic evidence to prove the defendant is proper; and
- Purchase sample product from the website and having the purchase process notarised, which shall be used as further evidence to prove the infringing liabilities.
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